This document contains analysis of recent data regarding wage taxes, licensing, zoning, and mobility related to Philadelphia’s nighttime economy. These analyses were originally gathered as part of my internal research by Philadelphia City Council’s Arts and Culture Task Force, Nightlife Committee. Currently, they are being used to provide key insights to the Philadelphia Commerce Department’s Night Time Economy Director as part of my advisory role to that office. They are presented here for public documentation, reproducibility, and transparency.
Attribution: Analysis by Michael Fichman, Associate Professor of Practice, University of Pennsylvania Weitzman School of Design.
Wage tax revenue data obtained from Philadelphia Controller’s Office, updated to 2023 tax year Q1, 6/18/2024. All other data obtained from Open Data Philly June, 2024.
For code base used to synthesize these data, and for previous versions of these analyses (2021 and 2022), refer to the code download button at the top of this document or visit the github repository for this page - https://github.com/mafichman/ACTF_nightlife . Data about “Save Our Stages” grants, and older tax analysis are available in Markdown documents hosted there.
Questions, contact mfichman@upenn.edu
Restaurants have had a strong recovery from COVID. Arts, recreation and hotels are lagging. These insights are based on analysis of wage tax receipts and the opening/closure of restaurant and entertainment licenses.
The number of both Assembly and Entertainment licenses both continue to decrease.
Entertainment tax receipts are back at roughly pre-COVID levels. This tells you maybe there is more economic activity going on, but less in the way of jobs/wages in entertainment/hospitality.
Gun violence is decreasing significantly city-wide. Corridors and areas near nightlife licenses still have fewer incidents than than elsewhere in the city, and “destination corridors” are, on average, much much safer than expected given their traffic level. Neighborhood corridors in areas with epidemic violence continue to have significant issues.
Quarterly wage tax receipts for industries in the arts and hospitality. These data only include the first quarter of 2023.
Data on nighttime-specific industries tend not to be subdivided by day and nighttime activity in wage tax data.
All dollar values adjusted for inflation (2023 dollars) based on BLS guidelines.
Takeaway: It looks like restaurants have done more rebounding than other hospitality sectors (data on new licenses confirms this). Hotels and the arts are still off the pace
Data for 2023 only represent Q1. All dollar values adjusted for inflation (2023 dollars) based on BLS guidelines.
| year | Arts, Entertainment, and Other Recreation | Hotels | Restaurants |
|---|---|---|---|
| 2014 | 13.52 | 14.19 | 55.85 |
| 2015 | 16.40 | 13.82 | 59.65 |
| 2016 | 18.54 | 14.06 | 64.22 |
| 2017 | 18.76 | 13.74 | 67.02 |
| 2018 | 19.00 | 14.20 | 67.57 |
| 2019 | 21.15 | 14.68 | 70.65 |
| 2020 | 15.49 | 7.63 | 48.45 |
| 2021 | 14.15 | 8.75 | 48.45 |
| 2022 | 17.96 | 12.16 | 63.07 |
| 2023 | 4.66 | 3.33 | 15.61 |
Tax revenues by Q1 of FY 2023 were still falling short of expected, meaning that recovery has not been achieved. Expected revenues are based on 2014-2020(TY Q1) trends (based on year, quarter and sector) and adjusted for inflation to 2023 dollars.
Projected wage tax revenues have not yet caught up to the trend-line of activity established in the ~6 years before COVID hit.
Wage tax losses since the beginning of 2020, relative to projections based on 2014-19, are still millions of dollars below expected returns based on pre-COVID trends.
On a percentage basis, this looks like the following. Hotels are still logging much less economic activity.
Why is this happening? Wage tax returns are down across the board - and these kinds of industries externalize hospitality activity. THe only things that are really “back” are services and retail.
Total tax shortfalls (compared to pre-pandemic trend) since March, 2020, in millions (2023 dollars)
| sector | Est Loss (millions) |
|---|---|
| Accounting, Auditing, Bookkeeping | -20.89 |
| Advertising and Other Professional Services | 15.42 |
| Arts, Entertainment, and Other Recreation | -40.69 |
| Banking & Credit Unions | -52.89 |
| Chemicals, Petroleum Refining | -62.63 |
| City, School District, Local Quasi Govt. | -42.51 |
| College and Universities | -86.46 |
| Computer | -25.65 |
| Construction | -41.28 |
| Doctors, Dentists, and Other Health Practitioners | -44.07 |
| Education | -70.70 |
| Elementary, Secondary Schools | -26.74 |
| Employment/Outsourcing Agencies | -25.89 |
| Engineering & Architectural Services | -29.79 |
| Federal Government | -48.11 |
| Food & Beverage Products | -30.17 |
| Government | -59.83 |
| Health and Social Services | 64.77 |
| Hospitals | -19.64 |
| Hotels | -47.65 |
| Insurance | -96.67 |
| Legal Services | -91.12 |
| Machinery, Electronic, and Other Electric Equipment | -34.68 |
| Management Consulting | -28.03 |
| Manufacturing | -74.67 |
| Membership Organizations | -43.12 |
| Metal Manufacturing | -41.95 |
| Miscellaneous Manufacturing | -37.88 |
| Miscellaneous Sectors | -33.20 |
| Nursing & Personal Care Facilities | -34.27 |
| Other Educational Services | -35.34 |
| Other Governments | -33.29 |
| Other Sectors | -34.79 |
| Outpatient Care Centers and Other Health Services | -20.81 |
| Pharmaceuticals | -30.60 |
| Professional Services | -11.83 |
| Public Utilities | -38.05 |
| Publishing, Broadcasting, and Other Information | -35.03 |
| Real Estate, Rental and Leasing | -39.98 |
| Restaurants | -67.80 |
| Retail Trade | 6.09 |
| Securities / Financial Investments | -44.98 |
| Security and Investigation Services | -30.71 |
| Services to Buildings | -36.45 |
| Social Services | 59.53 |
| Sport Teams | -30.17 |
| State Government (PA) | -36.86 |
| Telecommunication | -52.67 |
| Transportation Equipment | -38.63 |
| Transportation and Warehousing | -38.91 |
| Unclassified Accounts | -29.61 |
| Wholesale Trade | -48.94 |
Amusement tax revenues seem to be back.
Data from Philadelphia City Controller’s Office - 6/18/2024. Data are monthly through July, 2023
Source:
Last time, we created a really big rundown of SAOLs and where people were applying for them - whether that was triggering zoning changes and complicating the process. (The big takeaway was that opening up CMX-2.5 would double the amount of available parcels, and Councilmembers thought this was kind of tough to sell, but that maybe certain districts it was worth a chat).
This time the analysis is still there, but no major changes. There’s still a map of the city-wide zoning according to where SAOLs are permitted. Hopefully that’s helpful as a snapshot.
The big takeaway this year is that the number of active SAOLs in Philadelphia is still declining - more are expiring than opening. SAOLs are still being opened largely in places where there is significant zoning review, which brings council, RCOs etc., into play.
Assembly is allowed by right in four zoning districts, and by special exception in four others.
Here are some very basic descriptions of these types of zones, with information sourced from Anastasio Law - http://phillyzoning.com/
By Right
-CA-2 - Auto-oriented commercial
-CMX-4 - Commercial Mixed Use, mostly found in Center City or along major arterials like Broad, Market or Chestnut Streets
-CMX-5 - Commercial Mixed Use, found in the core of Center City office districts
-ICMX - Commercial/Industrial uses designed as a buffer between commercial and residential uses
Special Exception
-CMX-2 - Neighborhood commercial corridor, mixed use - e.g. Baltimore Avenue, Germantown Avenue
-CMX-2.5 - Commercial mixed use designed to promote pedestrian-friendly uses
-CMX-3 - Lower density commercial mixed use than CMX 4&5, found on major corridors like Kensington Ave, South St, Broad south of Washington.
-IRMX - “Low impact” industrial, including artist spaces
City-wide, roughly 26% of commercial districts (by area) are zoned for assembly by right. Much of this area is in large Center City tracts where creative spaces are unlikely to be developed due to cost or constraints of the land.
| assembly_allowed | sum_area | Pct |
|---|---|---|
| By-Right | 77783812 [US_survey_foot^2] | 26.13 [1] |
| Not Permitted | 47349858 [US_survey_foot^2] | 15.91 [1] |
| Special Exception | 172561837 [US_survey_foot^2] | 57.97 [1] |
The majority of areas zoned for assembly by-right are in Center City. This is not where most development of creative entertainment is taking place.
Take a look at districts outside Center City like Fishtown - by-right SAOL is not really allowed by-right anywhere.